When it comes to investing in luxury real estate, San Diego offers numerous opportunities. Its reputation as “America’s Finest City” creates steady demand for housing in key locations. Here are the benefits of investing in San Diego real estate.
Rental rates
San Diego has a potentially lucrative rental market since rental rates are higher than many places in California. The median gross rent was $1,885 from 2017 to 2021 compared to the national median gross rent of $1,163 during the same time period, according to theUS Census.
The median rent for all property types in San Diego is $3,300 with +$5 month-over-month change as of June 2023, according to Zillow. Those figures are higher compared to Los Angeles, where the median rent is $2,900 with -$84 month-over-month change. It is also higher than the state average for all rental properties in California, which is $2,895 with a month-over-month change of -$55 in June 2023.
Qualified tenants
As a prosperous city, San Diego tends to attract good tenants. The robust job market and vibrant economy brings top talent and high-income earners to the city. According to the US Census, the median household income from 2017 to 2021 was $89,457.
In addition, the owner-occupied housing unit rate was 47.7% during the same period. This means that less than half of residential units in the city are privately owned. The rest are rental properties that cater to the number of tenants in the city.
Tourism and in-migration
Situated along the Pacific coast, San Diego’s picturesque seaside setting attracts tourists and vacationers from around the world. This creates a market for short-term rentals in the city and the surrounding areas. With over 28.8 million visitors annually, the local tourism industry generates more than $1 billion annually in local and state transient occupancy, sales, and property taxes, according to the San Diego Travel Authority.
In addition to tourism, the growing population also creates demand for rentals. San Diego County welcomed 1,254 new residents between July 2021 and July 2022, according to the county-level population census. The city and its surrounding areas saw a pandemic-era migration from higher-cost urban centers from all over the United States.
Infrastructure and amenities
San Diego is prioritizing large-scale infrastructure projects to improve quality of life. In 2022, the City Council approved comprehensive policy changes that will make it possible for infrastructure projects to be built faster as well as to improve engagement and information gathering on local infrastructure needs.
Major freeways such as State Highway 163 and Interstate 5 and 805 go through the city. The City of San Diego Street Division maintains over 2,900 miles of streets and alleys for efficient public transport and enhanced walkability. It is also responsible for more than 5,000 miles of sidewalks, 40,000 street lights, and 70,000 drain structures.
When it comes to wifi and connectivity, California is the 12th most connected state and 100% of the population have access to 25 Mbps broadband speed or more. In addition to having reliable internet providers, San Diego offers open public wifi through its SD Access 4 All program.
Quality of life
San Diego is one of the most desirable places to live and study in the US. WalletHub ranked it the 6th “Best City to Raise a Family in America” out of more than 180 cities. The city ranked highly when it came to education, child care, and recreation. Top universities like San Diego State University and University of California, San Diego are globally renowned for their programs and research efforts. As for amenities, downtown San Diego and the historic Gaslamp Quarter provide access to world-class retail, dining, nightlife, and entertainment.
Explore San Diego real estate
Enjoy the benefits of living and investing in San Diego when you work with Jacobo Realty Group. Call our team at 760.632.8900 or send a message here for more information.